By Elizabeth Brackett
February 15, 2011
This is what some lenders are doing: they file a foreclosure and then ‘walk away’ because they deem it too expensive to maintain long-term vacant homes. And it’s going to cost Chicago some $36 million, according to a recent report from the Woodstock Institute.
As of September 2010, 6.3 percent of the addresses in Chicago were vacant for 90 or more days, and 55.8 percent of those vacant homes were unoccupied for more than a year. Read the January 2011 PDF from Woodstock Institute.
The Woodstock Institute gives the following suggestions to help curb the rising consequences of foreclosures in the city:
1. Homes should stay occupied through loan modification. State and federal regulators should hold servicers accountable for putting together initiatives to limit the damage foreclosures cause to at-risk neighborhoods.
2. More data needs to be shared on the issue of foreclosures. Lender ‘walkaways’ can’t happen in the dark, so to speak.
Woodstock, in its report, addresses the concern of disparities in foreclosure rates between blacks and whites. Foreclosure problems in Chicago are largely concentrated on the South and West Sides. Specifically, foreclosures are much more common in predominantly African-American communities. The following graph from the Woodstock Institute makes this point clear: